D.R. Horton Posts 85% Plunge in Q2 Earnings; Misses Street

U.S. homebuilder D. R. Horton yesterday posted an 85% drop in profits and said it had slashed a quarter of its workforce. The report followed last week's warning by the company that orders had fallen by 37%. Net income for the quarter dropped to $51.7 million ($0.16/share) from $352.8 million ($1.11) a year ago. Those figures reflect charges of $81.2 million ($0.16/share) for impairments and land option writedowns, 80% of which were in California. Analysts were expecting EPS of $0.27 excluding charges. Homebuilding revenue fell 26%, to $2.62 billion from $3.53 billion, missing Street forecasts of $2.79 billion. The company's backlog of homes under contract has shrunk to 16,885 homes worth $4.8 billion from 24,017 homes worth $7.1 billion a year ago. CEO Donald J. Tomnitz said he expects the weak market to continue into 2008.